Phase I Using Velcade & Idarubicin in Elderly and Relapsed AML

Inclusion Criteria: * Age: \> 60 years of age for newly diagnosed/transformed disease; \> 18 years of age for relapsed disease. * AML with or without antecedent hematologic disorder diagnosed by morphologic, histochemical, or cell surface marker criteria - as defined by the WHO classification (17). * Newly diagnosed, elderly patients who are considered unsuitable for intensive chemotherapy induction -- antecedent hematologic disorders, pre-existing myelodysplasia, trilineage dyspoiesis, unfavorable cytogenetics, or pre-existing comorbidities. * Untreated conditions meeting criteria the first and third criteria or patients with diagnosis as in criteria 2 who have relapsed after at least one successful induction therapy. (Relapsed patients treated on this protocol will be patients without a suitable donor for transplant or for whom transplant is not an option for other reasons.) * Karnofsky performance status \>60. * Adequate cardiac function as evidenced by an ejection fraction on MUGA \>/= 40, as well as no evidence of uncontrolled hypertension, New York Heart Class III/IV congestive heart failure, angina pectoris, or ventricular dysrhythmias. * Adequate renal function as evidenced by a calculated creatinine clearance \>/= 30ml/min (Cockcroft-Gault formula). * Adequate pulmonary function as evidenced by room air and exercise saturations \>/= 92 or DLCO \>/= 40% or FEV1 \>/= 60% of predicted. * Adequate liver function as evidenced by SGOT/SGPT less than 5 times the ULN and total Bilirubin less than 2 times the ULN except where abnormalities are directly attributable to leukemia. * Adequate neurologic function -- patients must be currently free of active CNS leukemia as evidenced by cytospin of CSF from lumbar puncture if there is any clinical suspicion for CNS leukemia. As well, patients must not have \>/= grade 2 neuropathy by NCI common toxicity criteria (CTC), Version 3.0. * Prior anthracycline dose in relapsed patients must not exceed 72 mg/m\^2 of idarubicin or any dose equivalent to 300 mg/m\^2 of adriamycin. * Patients must be informed and sign a written consent. Exclusion Criteria: * Patients with acute promyelocytic leukemia. Patients with uncontrolled systemic infection. * Patients who are known to be HIV seropositive. * Patients with evidence of CNS leukemia. * Patients who are pregnant or lactating. * Patients with primarily refractory disease unresponsive to a standard induction regimen. * Patients with a new diagnosis as per inclusion criteria 2, but for whom standard induction chemotherapy would be expected to be well tolerated and a preferred option in the opinion of the principal investigator. * Patients with relapsed AML, but for whom a suitable donor of stem cells exists and in whom high-dose chemotherapy with hematopoietic stem cell transplant is felt to be a better immediate alternative. * Patients with any clinically significant abnormality in screening blood chemistry, hematology or urinalysis results that, in the judgment of the investigator, would impede adequate evaluation of adverse events and/or response to treatment, or that requires aggressive intervention. * Patients with hypersensitivity to Bortezomib, boron, or mannitol.